The number of securities class action cases that involve allegations of accounting fraud is on the rise again, thanks to a slew of accounting restatements and an increase in market volatility last year, according to a new report from Cornerstone Research.

Class actions that included accounting allegations increased in 2011 to 70, up 52% from a four-year low of 46 in 2010, according to Cornerstone. Securities class action filings also edged up in the last year, with the cases including accounting allegations representing 37% of all 188 class actions filed in 2011, compared to 26% of 176 class actions filed in 2010. Read More »

U.S. regulators returned from a diplomatic trip to China with, apparently, nothing to show for their efforts. The mission, led by Public Company Accounting Oversight Board member Lewis Ferguson, hoped to convince Chinese government officials to allow joint inspections of audit firms working in that country. But the group, including staff from both the PCAOB and the U.S. Securities and Exchange Commission, returned from Beijing on July 13, and has yet to issue a report on its results. Read More »

Suddenly the boom in Chinese listings on U.S. exchanges is looking shaky, and two primary reasons were reinforced in separate developments today. On Wall Street, Renren, dubbed the Chinese Facebook, tanked after its shares debuted at a stratospheric multiple on Wednesday, calling into question the appetite for future Chinese IPOs. Meanwhile, at a New York City financial conference, SEC officials were nearly elbowing each other out of the way to express their concerns about reverse mergers that are allowing Chinese firms to back door their way into U.S. markets. Renren’s shares finished their first day of trading up 29%, giving the money-losing company a valuation of more than $7 billion. But a 15% drop today triggered the SEC’s short sale circuit breaker rule, which imposes limits on short-selling if shares drop by more than 10% in a single day. Read More »